Commodity prices slide on worsening sentiment

AFP, LONDON

Commodity prices mostly slid this week on worsening economic sentiment caused by political deadlock in indebted eurozone nation Italy and as the US braces for US$85 billion in budget cuts.

OIL: World crude prices reached multiweek low points as traders sought safety amid political turmoil in Italy, mixed economic data out of the US and China, and as dealers eyed huge US spending cuts that were due to kick in on Friday.

New York crude oil on Friday sank to US$90.29 a barrel — the lowest level since the end of last year.

At the same time, Brent North Sea crude reached a six-week low at US$109.82.

By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in April slid to US$110.35 a barrel from US$114.19 a week earlier.

On the New York Mercantile Exchange, West Texas Intermediate (WTI) or light sweet crude for April dropped to US$90.60 a barrel compared with US$93.02.

PRECIOUS METALS: The price of gold recovered from seven-month lows of under US$1,600 an ounce struck the previous week after US Federal Reserve chairman Ben Bernanke said the Fed’s stimulus program would continue.

Gold is seen as a good hedge against inflation, while stimulating the economy with new cash can push up inflation and weaken the dollar, according to experts..

By late Friday on the London Bullion Market, the price of gold edged up to US$1,582.25 an ounce from US$1,576.50 a week earlier.

Silver dropped to US$28.01 an ounce from US$28.79.

On the London Platinum and Palladium Market, platinum fell to US$1,579 an ounce from US$1,611.